Crazy Volatility
By Fri, Feb 12, 2021
Hey Scoopers,
The market indices ended Thursday with mixed results after another 790K+ new unemployment claims. — More on that in the “Overall Market” section.
Beyond the overall market, one real-estate technology stock rallied by exceeding expectations, while a pet insurance company scared them by turning unprofitable. — More on that in the “What’s Up?” and “What’s Down?” sections.
Oh, by the way, how crazy is the volatility in the cannabis sector? — More on that in the “Water Cooler” section.
But, first, here is a recap of what happened in the market yesterday:
Market Recap
- U.S. markets: For one more day, the stock market indices didn’t agree on the direction. Scroll down to the “Overall Market” section to read more.
- Cryptocurrency: Bitcoin’s price dropped to $47K- ish and then rose above $48K once more.
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Too Many New Jobless Claims
The Nasdaq and the S&P 500 indices finished the day above zero, but only barely. The Dow ended the day in the red, also slightly.
There was a dip around 1:00 PM across all three indices. As is customary on Thursdays, the new jobless claims report came out today and showed almost 800K people filed for unemployment last week. That was enough to create a somewhat dampened mood in the market.
Beating Expectations
So, what happened?
Shares of Zillow (Ticker: Z / ZG) were up more than 17%. The company announced its quarterly earnings reports. It had an excellent quarter beating analysts’ expectations. The exciting part of the earnings report was the success of Zillow’s home buying business that was once the source of distress. You can now sell your home to Zillow without the typically lengthy listing process, and the costs are quite comparable.
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Unprofitable Again
So what happened?
Shares of Trupanion (Ticker: TRUP) were down more than 11%. The pet insurance provider has been doing quite well for the last few quarters. Shares dropped more than 11% today, and that’s because it spooked investors by turning unprofitable again. It looks like it now costs the company more to get new customers. Reading the analyst’s call’s script, it seems the incremental cost is due to investing in customer experience. However, you can see the results of their investment in the customer experience, in their 98%+ retention rate. It seems the incremental expense is money well-spent.
Volatile Cannabis Stocks
So what happened?
Cannabis stocks went from the new hot rally to the double-digit crash between Wednesday and Thursday. Even Wednesday’s short-squeeze rally, Tilray (Ticker: TLRY), lost almost half of its value on Thursday.
It seems Redditers are either moving onto the next short squeeze or selling to lock gain from yesterday. Volatility is the name of the game for cannabis investors.
If you have any questions, or suggestions let us know by emailing us at members@tradestocks.com. We look forward to hearing from you.
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